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Talent Management

How Tech Firms Can Turn the Apprenticeship Levy into a Competitive Advantage

Richard Alberg

building.jpegFor tech organisations in the UK, the Apprenticeship Levy represents an opportunity to close a growing digital skills gap.

The highly anticipated Apprenticeship Levy is nearly upon us — scheduled to come into effect on April 6. UK employers with an annual payroll of more than £3 million will be required to put 0.5% of the total towards apprenticeship training and development. Each employer will then be able to spend their levy contributions on their own apprenticeship programmes and funds not spent will be lost after 24 months.

For the tech sector, the timing couldn’t be better. According to a recent PwC survey, 78% of UK business leaders and IT executives said that a “digital skills shortage” was holding them back. At the same time, 11.7% of computer science graduates are still unemployed six months after receiving their degrees.

Part of the problem is that these candidates lack relevant, real-world experience, making them less desirable than a candidate with two or three years on the job. But with a growing proportion of the workforce approaching retirement age and vacancies on the rise, filling the resulting vacancies through traditional means is simply no longer an option for entry- and even mid-level roles.

The point I’m getting at is that for the tech sector in particular, the Apprenticeship Levy represents a massive opportunity to establish a sustainable talent pipeline, thereby ensuring solid growth and profitability in the future.

Building a Brighter Future

The UK has had an apprenticeship system in place for years; however, the new levy will bring with it a number of changes, most of them beneficial.

Perhaps most importantly, there’s the question of who actually qualifies for apprenticeship funding. Under the current system, anyone holding a university degree is automatically ineligible for training. The new system will make funding available for workers of all types and experience levels. That means recent graduates, current employees and even managers will be able to participate in the programme.

For example, a tech firm could pluck a highly motivated computer science graduate directly from university (as I already mentioned, they’re certainly out there), and use £18,000 per person of funding to provide a structured learning journey that transforms them into a highly capable software engineer. But at the same time, firms could also select standout mid-level employees and enrol them in an executive leadership development programme.

I think that one of the biggest advantages of the new apprenticeship system is its flexibility. Companies can use their allowances to solve real talent-related issues they’re facing throughout the organisational hierarchy, not just with entry-level positions. Considering they’re required by law to pay into the programme (and that the funding simply disappears if they fail to use it), the only real option here is to make the most of the situation. And ultimately, building a stronger team and investing in the future of your company doesn’t sound like such a bad thing, does it?

Seeing a Return on Your Investment

While some organisations will invest in training for existing staff, I think it’s safe to assume that the vast majority will go towards new employees. This presents a challenge for tech recruiters, especially with roles suited for recent grads and younger candidates. How can firms determine which applicants should receive apprenticeship training when the talent pool has little or no real-world experience?

For tech firms running high-volume campaigns, interviewing each individual candidate isn’t an option, at least not on the phone or in person. Automated screening tools and video interviewing software allow recruiters to get a better sense of an applicant’s “soft skills” without overloading their capacity in the early stages of assessment.

At the end of the day, tech firms have a real issue that needs solving: an ageing workforce and a rapidly growing digital skills gap. The Apprenticeship Levy represents an opportunity to equip a new generation of employees with the requisite knowledge and experience to help keep the UK on the leading edge of tech innovation and the global market. And I think that’s a cause that everyone can get behind.

Richard Alberg

Richard Alberg is the CTO of Corndel